A quarterly survey of more than 200 bankers from Nebraska to New Mexico shows farmer incomes have moved lower for nine consecutive reports.
The Kansas City Federal Reserve released its Ag Credit Survey for the 10th District Thursday, and Omaha-branch executive Nathan Kaufman says there has also been a steady rise in farm loan requests.
“Specifically in operating loans, and also corresponding to some softening in the farmland market. These are things that have been continuing and continued through the second quarter.”
Despite two years of a lower income environment, bankers continue to say credit quality looks pretty good and repayment problems have been minor.
“I think most bankers are still looking at this as a sign of caution and a reason to be concerned about the coming years. But it’s still looking like credit looks pretty good and that repayment problems have only been minor so far.”
Kaufman says areas in the District that rely more heavily on crop production are hurting more than those concentrated on livestock.
“That’s also been borne out, if you look at the study showing cropland values softening even at a time when pastureland and ranchland has still been gaining. That is reflecting some of the differences in the regional composition of agriculture as you see the crop sector a bit softer and the livestock sector, in general (specifically the cow-calf side), relatively strong.”
The 10th District consists of Nebraska, Kansas, Oklahoma, Colorado, Wyoming, the northern part of New Mexico and the western part of Missouri.
Source: www.brownfieldagnews.com